Seigniorage (redirected from Seigneurage)

Seigniorage

The difference between the value of money and the cost to produce it.

Notes:

Seigniorage may be counted as revenue for a government when the money that is created is worth more than it costs to produce it. This revenue is often used by governments to finance a portion of their expenditures without having to collect taxes. If, for example, it costs the U.S. Government $0.05 to produce a $1 bill, the seigniorage is $0.95, or the difference between the two amounts.

See also: Currency, Fiat Money, Gold Standard, Hard Money, Soft Money

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Seigniorage

The amount of goods and services that the government obtains by printing new money in a given period. Often we consider this in real terms, by dividing the new money by the price level.